WASHINGTON, D.C., U.S. — Mexico’s wheat production for the marketing year 2016-17 is forecast to increase to 3.9 million tonnes, the U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service (FAS), said in a March 12 report. This increase of approximately 3.7% assumes favorable weather conditions and normal yields in the key wheat areas of Northwest Mexico (Baja California and Sonora) for the 2015-16 fall/winter crop cycle.

Mexico's wheat consumption is expected to increase slightly in market year 2016-17 due in part to population growth and the continued popularity throughout Mexico for bread products and the interest among consumers for other types of wheat-baked goods. The Mexican Millers Association (CANIMOLT) has stated that wheat consumption is expected to grow into the next decade, driven by population growth and higher per capita consumption.

The total wheat import forecast for market year 2016-17 is estimated to increase slightly to 4.45 million tonnes from market year 2015-16, due to higher demand for imported varieties used to make bread wheat. Private analysts expect that the proportion of domestic durum production will be slightly higher in market year 2016-17, compared to the previous year. As result, Mexican millers could increase their demand for imported wheat of various varieties for milling, especially soft wheat varieties.

Mexico’s corn production for the marketing year 2016-17 is forecast at 22.6 million tonnes with harvested area estimated at 6.95 million hectares. Some forecasters predict the El Niño weather pattern could affect the market year 2016-17 corn crop.

The total corn consumption estimate for market year 2015-16 has been revised upward from USDA official figures, based on information from private sources. Feed consumption is expected to shift somewhat from sorghum to corn, due to lower than previously estimated domestic sorghum production.

For market year 2016-17 total corn consumption is forecast to increase 1.6% compared to the previous year. This increase is expected to be driven mainly by the expansion in the Mexican livestock and poultry sectors and other food industries such as starch, cereal and snacks.

The total corn import forecast for market year 2016-17 is expected to increase approximately 4.3%, driven by the strong demand from the livestock and starch sectors. For market year 2016-17, the corn export forecast for Mexico is 300,000 tonnes.

According to animal feed industry sources, demand for Distiller’s Dried Grains with Solubles (DDGS), a co-product of corn-based ethanol production that is used mainly as an animal feed protein supplement, has been increasing slightly over the last couple years.

To read the full report, click here.